Shocking video footage shot by animal rights activists at a Costco egg farm in California shows chickens living in appalling conditions and pecking each other to death.

The eggs produced at the farm are being labelled as 'cage-free', but the video released earlier this week casts doubt over the animals' living conditions.

The chickens, many missing their feathers and gravely injured, are living on top of each other in a crowded barn, and are covered in feces.

The film, shot by the group Direct Action Everywhere (DxE), also appears to show chickens eating one another as well as dead birds lining the floor of the Farmington egg farm where they are based.

Animal rights group Direct Action Everywhere filmed conditions at a California cage-free farm that provides eggs for the national Costco store chain

The video shows dead birds on the floor and injured hens pecked by other chickens

The conditions were all caught on camera. One bird had a piece of flesh hanging off its beak

'What we saw inside the farm was no better than what is seen in a caged facility, the hens are still in pain, still exploited and still dying from egg production,' DxE investigator Samer Masterson said in a statement following the release of the video.

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The activists say the eggs that come from the facility are sold as 'certified humane', however the conditions witnessed inside the barn show there remains considerable work to be done.

After the apparent break-in by the activists, the owner at Pleasant Valley Farms ended up destroying the entire flock.

The company says that it did so to prevent the spread of diseases that may have been brought into the barn by the activists.

The eggs that are currently produced at the barn are sold at Costco under the Kirkland Signature brand.

The egg industry has long warned that hens living in cage-free systems could experience higher mortality rates and more disease

There were birds rotting on the floor, and there was one dead bird that seemed to have lost its head

This bird appears to have lots most of its feathers after being attacked by others driven insane by the crowded conditions in which the birds are kept

Speaking with The Huffington Post, one of the video's makers described scenes of cannibalism. Driven insane by crowding, the birds attack one another pulling out their internal organs.

'I watched as one bird, bloodied and unable to walk, dragged her body across a manure pile in a desperate attempt to flee. Despite our team's efforts, this little hen could not be saved,' said Wayne Hsiung, co-founder of DxE.

In another interview with the New York Times, Hsiung spoke of the deplorable conditions his team encountered: 'There were birds rotting on the floor, and there was one dead bird that seemed to have lost her head. There were birds attacking birds, and the smell was horrible.'

'Consumers have an idyllic vision of what cage-free farming looks like,' Mr. Hsiung said. 'They need to be shown the truth, which is that cage-free is far from humane.'

While the hens are not in cages, the video shows them crowded together, covered in feces and blood, struggling to breathe and attacking and even eating one other

Chickens were seen to be living in atrocious conditions at the cage-free barn

The DxE group which sneaked into the farm say they are trying to show the nation where its food comes from

Costco has since issued a statement saying it is satisfied with the animal welfare conditions employed at the farm.

'We have re-inspected the barn and other operations of this supplier, and based on these inspections and prior audits we are comfortable with the animal welfare aspects of the operation.

'We continue to proceed with increasing our sourcing from cage-free egg solutions as the way to satisfy the demands of our customers and the welfare standards to which animals are entitled,' it said.

Nine out of 10 chickens in the United States live in battery cages which confine birds to a space about as large as a piece of paper for the duration of their lives

Other animal-rights activists have defended cage-free farming, saying that while far from perfect, it is better than battery cages

In a statement given to SeattlePi.com, a spokesperson for the farm said its facilities met requirements set by the U.S. Department of Agriculture.

'This video does not accurately show what truly goes on in our barns and appears to be staged for the production affect.

'Given the need for strict bio-security to protect food safety and hen health, the break-in and trespassing by members of Direct Action Everywhere may have contaminated all the birds in the hen house.

'Due to their illegal actions and carelessness, after the flock was observed by third party auditors and an outside veterinarian, we were forced to dispose of the entire flock to prevent any disease outbreak.'

Pleasant Farm claim 'the video footage does not accurately show what truly goes on in our barns and appears to be staged for production effect'

Members of Direct Action made several visits to cage-free barns at Pleasant Valley Farms, an egg producer in Farmington, California